Nymex Crude Rises, Bouncing Off Recent 2013 Low
U.S. crude futures posted modest gains Friday following sharp declines early this week as traders paused to gauge whether weak demand will keep prices moving lower.
Light, sweet crude for May delivery settled higher by 28 cents, or 0.3%, at $88.01 a barrel on the New York Mercantile Exchange. Brent crude on the ICE futures exchange for June delivery settled 52 cents higher at $99.65 a barrel.
Oil prices fell 3.6% this week, and are down nearly 10% in April amid high domestic crude-oil supplies and a broader investor retreat from commodities markets. With futures trading near 2013 lows, some investors say a brief rebound is likely even if further declines are ahead.
"Traders are looking for a reason for why this thing might bounce back," said Pete Donovan, an oil broker at Vantage Trading in New York.
Earlier Friday, crude futures rose after Venezuela's oil minister Rafael Ramirez said the Organization of the Petroleum Exporting Countries was discussing holding a special meeting after Brent crude fell below $100 a barrel. But prices pared gains when three OPEC officials said the group isn't taking formal steps to gather, making such an event unlikely before a scheduled conference at the end of next month.
Venezuela officials have made frequent calls to hold an oil-price "floor" of $100 a barrel.
Meanwhile, many analysts and investors have grown concerned in recent weeks about weak fuel demand, particularly with the approach of the summer driving season in the U.S.
Last week, the U.S. Energy Information Administration predicted spring-summer demand for gasoline will fall to a 12-year low of 8.877 million barrels a day.
The slump also coincides with a broader turn from commodities markets. Traders have fled from gold, silver, copper and several energy markets in recent weeks. In addition to weaker demand for oil in the U.S., many commodity investors are concerned that slowing growth in China will also limit demand for raw materials.
"Commodities may face a slow growth environment for the next few quarters," said Barclays analysts in a research report Friday.
Mark Waggoner, head of Excel Futures, said any rebound in oil will be brief.
"The market may try and bump up a little bit, but that's it. It's going down," he said, though he added that market activity on Friday was muted, possibly because people were following the search for a suspect in the Boston Marathon bombing. "Most of the people are just talking about Boston."
Front-month May reformulated gasoline blendstock, or RBOB, settled 1.69 cents higher at $2.7724 a gallon. May heating oil settled 0.85 cent higher at $2.7876 a gallon.
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